Stiglitz: This belief is still powerful, but the American dream has become a
myth. The life chances of a young US citizen are more dependent on the income
and education of his parents than in any other advanced industrial country...
The belief in the American dream is not supported by the data. ...

Spiegel: We thought that as a rule Americans don't begrudge the rich their
wealth, though.

Stiglitz: There is nothing wrong if someone who has invented the transistor or
made some other technical breakthrough that is beneficial for all receives a
large income. He deserves the money. But many of those in the financial sector
got rich by economic manipulation, by deceptive and anti-competitive practices,
by predatory lending. They took advantage of the poor and uninformed... They sold them costly mortgages and were hiding details of the fees in
fine print.

Spiegel: Why didn't the government stop this behavior?

Stiglitz: The reason is obvious: The financial elite support the political
campaigns with huge contributions. They buy the rules that allow them to make
the money. Much of the inequality that exists today is a result of government
policies.

Spiegel: Can you give us an example?

Stiglitz: In 2008, President George W. Bush claimed that we did not have enough
money for health insurance for poor American children, costing a few billion
dollars a year. But all of a sudden we had $150 billion to bail out AIG, the
insurance company. That shows that something is wrong with our political system.
It is more akin to "one dollar, one vote" than to "one person, one vote." ...

Spiegel: So your answer to the inequality problem is to transfer money from the
top to the bottom?

Stiglitz: First, transferring money from the top to the bottom is only one
suggestion. Even more important is helping the economy grow in ways that benefit
those at the bottom and top, and ending the "rent seeking" that moves so much
money from ordinary citizens to those at the top. ...

Nothing particularly new here, but I wanted to highlight the point about
rent-seeking, anti-competitive practices, etc. once again since I don't think this cause of inequality receives enough
attention.

Stiglitz: This belief is still powerful, but the American dream has become a
myth. The life chances of a young US citizen are more dependent on the income
and education of his parents than in any other advanced industrial country...
The belief in the American dream is not supported by the data. ...

Spiegel: We thought that as a rule Americans don't begrudge the rich their
wealth, though.

Stiglitz: There is nothing wrong if someone who has invented the transistor or
made some other technical breakthrough that is beneficial for all receives a
large income. He deserves the money. But many of those in the financial sector
got rich by economic manipulation, by deceptive and anti-competitive practices,
by predatory lending. They took advantage of the poor and uninformed... They sold them costly mortgages and were hiding details of the fees in
fine print.

Spiegel: Why didn't the government stop this behavior?

Stiglitz: The reason is obvious: The financial elite support the political
campaigns with huge contributions. They buy the rules that allow them to make
the money. Much of the inequality that exists today is a result of government
policies.

Spiegel: Can you give us an example?

Stiglitz: In 2008, President George W. Bush claimed that we did not have enough
money for health insurance for poor American children, costing a few billion
dollars a year. But all of a sudden we had $150 billion to bail out AIG, the
insurance company. That shows that something is wrong with our political system.
It is more akin to "one dollar, one vote" than to "one person, one vote." ...

Spiegel: So your answer to the inequality problem is to transfer money from the
top to the bottom?

Stiglitz: First, transferring money from the top to the bottom is only one
suggestion. Even more important is helping the economy grow in ways that benefit
those at the bottom and top, and ending the "rent seeking" that moves so much
money from ordinary citizens to those at the top. ...

Nothing particularly new here, but I wanted to highlight the point about
rent-seeking, anti-competitive practices, etc. once again since I don't think this cause of inequality receives enough
attention.